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Minnesota House approves steep minimum wage increase

ST. PAUL, Minn. (AP) — A bill that could eventually give Minnesota the nation's highest minimum wage cleared the House on Friday, though it could be throttled back a bit before becoming law.

By a 68-62 vote, the House advanced the bill to push up the current $6.15 floor rate in three steps until it hits $9.50 in 2015. Other states are weighing minimum wage bills, so it's difficult to tell if Minnesota will lead the pack. But supporters don't consider that the goal.

"This is about paying people enough to get by — not a living wage, enough to get by," said Rep. Jason Metsa, DFL-Virginia.

With few exceptions, Minnesota workers now earn at least the federal hourly minimum of $7.25.

Only Washington state — at $9.19 per hour— has a minimum wage near the amount proposed in the bill. Many states match the federal minimum. Five states don't have minimum wage laws of their own. Minnesota is one of the few states with a wage floor lower than the federal standard.

Under the plan, Minnesota's minimum wage for companies with $500,000 or more in earnings would go to $8 this summer, $9 a year later and $9.50 in 2015. After that, it would rise according to inflation, with possible yearly bumps up to 2.5 percent.

Currently, about 93,000 people earn the minimum wage in Minnesota. But the bill affects nearly four times as many because the escalating wage would eventually force their pay up.

Supporters noted that the two prior minimum wage increases were signed into law under Republicans governors — Tim Pawlenty in 2005 and Arne Carlson before him.

Republicans still fought it. Rep. Pat Garofalo of Farmington said the mandated pay raise would come out of the bottom line of business, costing jobs and raising prices for goods in the end.

"Money does not grow on trees," he said. "Someone has to pay the bill."

The bill's author, Democratic Rep. Ryan Winkler of Golden Valley, shot back at the notion that a higher minimum wage is bad for business.

"Low wage workers need all the money they can earn for basic necessities of life. When they get an extra dollar in their pocket they spend it right away for basic needs," he said. "That dollar gets multiplied through the economy. Business benefits because demand for the goods and services they sell goes up significantly."

The vote saw three Democrats break ranks and join Republicans in opposition.

The Senate plans to vote Wednesday on a bill that would set the minimum wage at $7.75 per hour, said Majority Leader Tom Bakk, DFL-Cook. Bakk said he's worried about raising the wage too high, too fast, particularly in border towns and for the restaurant industry.

"There's a serious competitive issue in some areas of the state and any increase is probably difficult for them," Bakk said.

Gov. Mark Dayton has said he could support a minimum wage of between $9 and $9.50 per hour.

More than half the state's minimum wage workers are employed by eating and drinking establishments, according to state statistics.

On a tie vote, House members defeated a bill that would have created a tiered pay system for restaurant wait staff. It would have factored tips into what servers could make. Proprietors would have to pay at least $7.25 per hour if servers earned a $4.75 or more per hour in gratuities. That would get bumped up to the new state minimum wage if a server's average tips and hourly earnings didn't reach $12 per hour combined.

The state now requires overtime be paid after 48 hours, but the bill would cut that to 40 hours. The House voted to exempt car dealers, mechanics and farm workers from the new overtime threshold. Farm country lawmakers argued that it would have been a hardship during planting and harvest time.

"Sixteen times three is 48 — that's Wednesday evening," said Rep. Paul Anderson, a farmer from Starbuck. "It works out there. We have to be competitive. Our neighboring states don't have these overtime regulations."

Another provision in the bill would permit people to take 12 weeks in unpaid parental leave upon the birth or adoption of a child — double the six week limit now in place.